Order 2013-1-8

Served: January 11, 2013

UNITED STATES OF AMERICA

DEPARTMENT OF TRANSPORTATION

OFFICE OF THE SECRETARY

WASHINGTON, D.C.

Issued by the Department of Transportation

on the 11th day of January, 2013

Essential Air Service at

KINGMAN, ARIZONA

PAGE, ARIZONA

PRESCOTT, ARIZONA

SHOW LOW, ARIZONA

Under 49 U.S.C. 41731 et seq. 

DOCKET DOT-OST-1996-1899

DOCKET DOT-OST-1997-2694

DOCKET DOT-OST-1996-1899

DOCKET DOT-OST-1998-4409

 

ORDER REQUESTING PROPOSALS

Summary

By this Order, the Department is requesting proposals from airlines interested in providing 

Essential Air Service (EAS) at Kingman, Page, Prescott, and Show Low, Arizona, for a new 

term beginning May 1, 2013, with or without subsidy. Proposals are due by February 12, 2013. 

(See Appendix A for a map.)

Background

By Order 2011-3-4, March 1, 2011, the Department re-selected Great Lakes Aviation, Ltd. 

(Great Lakes), to provide EAS at the above-mentioned communities for the two-year term 

ending April 30, 2013, using 19-passenger Beechcraft 1900D aircraft for a combined annual 

subsidy of $6,278,887.

Great Lakes was selected to provide Kingman with 12 nonstop round trips a week to either Las 

Vegas McCarran International Airport (Las Vegas) or Phoenix Sky Harbor International 

Airport (Phoenix) for an annual subsidy of $1,168, 390.1 

 1 Recently the Department permitted Great Lakes to change Kingman’s hub to Los Angeles International Airport. 

See Order 2012-11-5.
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At Page, Great Lakes provides the equivalent of three round trips a day, with four weekday 

round trips (reduced weekend service) during the peak season and two round trips a day during 

the non-peak season for an annual subsidy of $1,559,206. Service from Page is to Phoenix, 

with an option that one round trip a day may be substituted to either Denver International 

Airport (Denver) (one-stop) or Las Vegas (nonstop). 

At Prescott, the airline flies 18 weekly nonstop round trips to Los Angeles International Airport 

(Los Angeles) or Ontario International Airport, and/or one-stop service to Denver for an annual 

subsidy of $1,832,233. 

At Show Low, Great Lakes provides 18 weekly nonstop round trips to Phoenix, with an option 

to serve Denver via Prescott with one round trip a day for an annual subsidy of $1,719,058.

Legislative Changes Which May Affect Future EAS Eligibility at Kingman

The Federal Aviation Administration (FAA) Modernization and Reform Act of 2012 (Public 

Law No: 112-95) amended 49 U.S.C. §41731(a)(1)(B) to change the definition of “eligible 

place” for the purpose of receiving EAS. The amendment states that to be eligible, a 

community must maintain an average of 10 enplanements or more per service day, as 

determined by the Secretary, during the most recent fiscal year beginning after September 30, 

2012.2 The legislation exempts locations in Alaska and Hawaii and communities that are more 

than 175 driving miles from the nearest large or medium hub airport. As Kingman is only 

about 121 miles from the Las Vegas, the community must meet the 10-enplanement-a-day 

threshold for EAS to continue after FY2013 or otherwise face termination of its eligibility to 

receive EAS, barring a waiver from the Secretary.

In the most recent fiscal year for which data are available, FY2012 (October 2011-September 

2012), Kingman generated a total of 2,063 passengers (inbound and outbound), or an average 

of 3 enplanements per day.3 Air carriers submitting proposals should provide a discussion on 

how they would attract enough passengers to meet the 10 enplanements per day statutory 

requirement in order for Kingman to remain eligible to continue receiving EAS after FY2013. 

Proposing air carriers should also be aware that the Department will continue to monitor 

Kingman’s eligibility to receive EAS in light of these new requirements throughout the life of 

any executed contract. The Department may cancel a contract for any community receiving 

EAS if enplanements remain below 10 per day during FY2013. Communities that believe their 

enplanements are below 10 per day due to a temporary decline should provide a detailed 

explanation of the temporary decline to the Department with relevant supporting documents.

In addition, the Department is prohibited from subsidizing air service at a community where the 

subsidy per passenger exceeds $200, unless the community is more than 210 highway miles 

from the nearest large or medium hub airport.4 Kingman’s subsidy per passenger is $566, well 

 2 The Secretary also has authority to waive the 10 passenger requirement, on an annual basis, if the community 

can demonstrate that the reason the location averages fewer than 10 passengers per day is due to a temporary 

decline in enplanements. See 49 U.S.C. §41731(e).

3 Source: Bureau of Transportation Statistics; Form 41, Schedule T-100. Daily averages are based on one-half of 

the O&D passengers, divided by 313 service days (314 during leap years).

4 Congress first established the $200 ceiling under P.L. 101-164 for fiscal year 1990, and reestablished it in fiscal 

years 1994-1999. The ceiling was made permanent by P.L. 106-69, the Department of Transportation and Related 

Agencies Appropriations Act of 2000.
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above the $200 ceiling.5 Rather than terminate the community’s eligibility, at this state, the 

Department will solicit proposals for EAS and evaluate all proposals before either committing 

to a two-year contract to making a final determination on Kingman’s continuing eligibility to 

receive EAS in light of its current subsidy per passenger being above the $200 ceiling. We 

therefore expect air carriers to detail in their proposals how they will work with the community 

in getting the subsidy per passenger under the $200 cap.

Special discussion concerning Show Low

As discussed above, the Department is prohibited from subsidizing air service at a community 

where the subsidy per passenger exceeds $200, unless the community is more than 210 

highway miles from the nearest large or medium hub airport. Show Low is 154 miles from 

Phoenix and based on FY2012 data (October 1, 2011, through September 30, 2012), 8,360

passengers were enplaned and deplaned at Show Low. The annual subsidy amount for Show 

Low is $1,719,058. Therefore, the subsidy per passenger at Show Low is $206, just over the 

subsidy per passenger ceiling. Rather than terminate the community’s eligibility, at this stage, 

the Department will solicit proposals for EAS and evaluate all proposals submitted before

either committing to a two-year contract or making a final determination on Show Low’s 

continuing eligibility to receive EAS in light of its current subsidy per passenger being above 

the $200 ceiling. During the 30-day window for proposals, we expect both communities to 

work aggressively with all potential applicants to mitigate some of the risks that the air carriers 

may face in an attempt to lower their subsidy levels. We also expect air carriers to detail in 

their proposals how they will work with the community in getting the subsidy per passenger 

under the $200 cap.

Request for Proposals

Air carriers should file their proposals no later than February 12, 2013. After that date, our 

staff will docket proposals, thereby making them public, and shortly afterwards will provide a 

summary of the proposals to the community and ask them for their final comments. We will 

give full consideration to all proposals filed in a timely manner. 

Interested air carriers should prepare their proposals with every expectation that their initial 

proposals will also be their final and only proposals. We retain the discretion to negotiate 

proposals with air carriers when we deem it desirable. We also retain the discretion to reject 

outright all unreasonable or unrealistic proposals and solicit a new round of proposals. 

Air carrier proposals should be submitted to the Department with all materials merged into a 

single document. In addition, because the document will be published on 

www.regulations.gov, each page should be formatted to be viewed online. 

We are here providing interested air carriers with some basic information to serve as guidance 

when they prepare their proposals, but we will not prescribe a precise format. We expect 

proposals to adequately describe the service being proposed and the annual amount of subsidy 

being requested. The applicants can make their own judgments as to the level of detail they 

wish to present; however, they might want to include proposed schedules as well as supporting 

data for their subsidy requests, such as projected block hours, revenues and expenses. We 

 5 Subsidy per passenger is calculated by dividing the annual subsidy by the total passengers enplaned and 

deplaned at the airport. Kingman’s annual subsidy is $1,168,390 and the total passengers enplaned and deplaned 

for FY12 were 2,063. Therefore Kingman’s subsidy per passenger is $566.
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strongly encourage clear, well-documented proposals that will facilitate their evaluation by the 

affected community and the Department.6

Air carriers are also welcome to propose more than one option, if they choose; they need not 

limit themselves to those requirements if they envision other, potentially more attractive service 

possibilities -- different hubs, frequency or equipment, for example -- with subsidy 

requirements that remain competitive. The communities and air carriers are encouraged to 

work together in advance of the due date for proposals to craft a service pattern that is desirable 

to the community and meets the operational needs of the airlines.

Proposals should provide sufficient capacity to accommodate historical levels of traffic. In 

order to assist carriers in developing traffic and revenue projections for their proposals, we 

have provided a summary of historical passengers in Appendix B. Below is a summary of the 

average enplanements for each community for the year ended September 30, 2012:

Community Enplanements per day

Kingman 3

Page 20

Prescott 17

Show Low 13

We expect service levels that are consistent with what the communities currently receive, with 

service to any large- or medium-hub airport that offers access to the national air transportation 

system utilizing two-pilot, twin-engine aircraft. Given the low passenger levels at Kingman, 

the Department would expect two round trips each weekday and weekend (12 a week). At 

Page, Prescott, and Show Low, we would expect proposals for three round trips each day (18 a 

week) with 19-30-seat or larger aircraft, or additional frequencies utilizing 8/9-seat aircraft. 

Other Air Carrier Requirements

The Department is responsible for implementing various Federal statutes governing lobbying 

activities, drug-free workplaces and nondiscrimination.7 Consequently, all air carriers 

receiving Federal subsidy to support EAS must certify that they are in compliance with 

Department regulations regarding drug-free workplaces and nondiscrimination, and those 

carriers whose subsidies exceed $100,000 over the life of the rate term must also certify that 

 6 In selecting a carrier to provide subsidized EAS, 49 U.S.C. §41733(c)(1) directs us to consider four factors: 

(1) service reliability; (2) contractual and marketing arrangements with a larger carrier at the hub; (3) interline 

arrangements with a larger carrier at the hub; and (4) community views. In addition, the Consolidated 

Appropriations Act, 2008, Public Law 110-161, provides that when selecting a carrier to provide EAS, the 

Department may consider the relative subsidy requirements, thus codifying a factor that we have considered 

since the inception of the program. Interested carriers should also be aware that our general provisions 

governing EAS will be included in the selection order as part of our authorization of subsidy for the selected 

service. Appendix C of this order contains those general provisions.

7 The regulations applicable to these areas are: (1) 49 CFR Part 20 – New restrictions on lobbying; (2) 49 CFR 

Part 21 – Nondiscrimination in federally-assisted programs of the Department of Transportation – Effectuation of 

title VI of the Civil Rights Act of 1964; 49 CFR Part 27 – Nondiscrimination on the basis of disability in programs 

and activities receiving or benefiting from Federal financial assistance; and 14 CFR Part 382 – Nondiscrimination 

on the basis of disability in air travel; and (3) 49 CFR Part 29 – Government-wide debarment and suspension (nonprocurement) and government-wide requirements for drug-free workplace (grants).
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they are in compliance with the regulations governing lobbying activities. All air carriers that

plan to submit proposals involving subsidy should submit the required certifications along with 

their proposals. Interested air carriers requiring more detailed information regarding these 

requirements, as well as copies of the certifications, should contact the Office of Aviation 

Analysis at (202) 366-5903. The Department is prohibited from paying subsidy to carriers that 

do not submit these documents.8

Community and State Comments

Civic officials and the State are welcome to submit comments on the proposals at any time. As 

noted earlier, we will provide a summary of the proposals to the civic parties and ask them to 

submit their final comments shortly after February 12, 2013, the due date for carrier proposals.

This order is issued under authority delegated in 49 CFR 1.56a(f) and re-delegated to the 

Director, Office of Aviation Analysis.

ACCORDINGLY,

1. We request that air carriers interested in providing Essential Air Service at Kingman, Page,

Prescott, and Show Low, Arizona, submit their proposals, with or without subsidy requests, no 

later than February 12, 2013. The proposals should be emailed to: EAS@dot.gov with the title 

“Proposal to Provide Essential Air Service at Kingman, Page, Prescott, and/or Show Low, 

Arizona”;9

2. These dockets will remain open until further order of the Department; and

 8 The certifications are also available on the web at http://ostpxweb.dot.gov/aviation/index.html.

9 Questions regarding this Order should be directed to Michael Martin at 202-366-6494, or via email at 

michael.f.martin@dot.gov.
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3. The Department will serve a copy of this Order on the mayors and airport managers of 

Kingman, Page, Prescott, Show Low, Great Lakes Aviation, Ltd. (Great Lakes), and the parties 

listed in Appendix D.

Persons entitled to petition the Department for review of this order under the Department’s 

Aviation Economic Regulations, 14 CFR Part 385.50, must file such petitions within ten (10) 

days after the date of service of this order.

This Order will be effective immediately, and the filing of a petition for review shall not 

preclude its effectiveness.

By:

TODD M. HOMAN

Director

Office of Aviation Analysis

(SEAL)

An electronic version of this document is available online at

www.regulations.gov
Appendix A

Area Map

Maps generated by the Great Circle Mapper - copyright © Karl L. Swartz.
APPENDIX B

Page 1 of 4

Historical Origin-Destination Plane Traffic1

Kingman, Arizona

Quarter Year Deplanements Enplanements

Total 

Traffic

Enplanements 

per Day

4 2009 381 293 674 4

1 2010 235 268 503 3

2 2010 248 190 438 3

3 2010 224 230 454 3

Annual 

Totals 1,088 981 2,069 3

4 2010 256 209 465 3

1 2011 247 226 473 3

2 2011 239 228 467 3

3 2011 229 244 473 3

Annual 

Totals 971 907 1,878 3

4 2011 281 265 546 3

1 2012 268 289 557 4

2 2012 278 250 528 3

3 2012 210 222 432 3

Annual 

Totals 1,037 1,026 2,063 3

 1 Source: USDOT Bureau of Transportation Statistics, TransStats Intermodal Database, Schedule T-100.
APPENDIX B

Page 2 of 4

Historical Origin-Destination Plane Traffic1

Page, Arizona

Quarter Year Deplanements Enplanements

Total 

Traffic

Enplanements 

per Day

4 2009 1,072 1,086 2,158 14

1 2010 885 806 1,691 11

2 2010 1,915 1,631 3,546 23

3 2010 2,450 2,222 4,672 30

Annual 

Totals 6,322 5,745 12,067 19

4 2010 1,081 1,136 2,217 14

1 2011 768 737 1,505 10

2 2011 1,786 1,553 3,339 21

3 2011 2,661 2,540 5,201 33

Annual 

Totals 6,296 5,966 12,262 20

4 2011 773 829 1,602 10

1 2012 679 629 1,308 8

2 2012 2,236 1,802 4,038 26

3 2012 2,757 2,669 5,426 34

Annual 

Totals 6,445 5,929 12,374 20

 1 Source: USDOT Bureau of Transportation Statistics, TransStats Intermodal Database, Schedule T-100.
APPENDIX B

Page 3 of 4

Historical Origin-Destination Plane Traffic1

Prescott, Arizona

Quarter Year Deplanements Enplanements

Total 

Traffic

Enplanements 

per Day

4 2009 3,324 3,388 6,712 42

1 2010 2,026 1,910 3,936 26

2 2010 2,486 2,484 4,970 32

3 2010 2,158 2,133 4,291 27

Annual 

Totals 9,994 9,915 19,909 32

4 2010 1,334 1,301 2,635 17

1 2011 1,027 976 2,003 13

2 2011 1,364 1,345 2,709 17

3 2011 1,402 1,436 2,838 18

Annual 

Totals 5,127 5,058 10,185 16

4 2011 1,454 1,400 2,854 18

1 2012 1,142 1,107 2,249 15

2 2012 1,361 1,348 2,709 17

3 2012 1,386 1,297 2,683 17

Annual 

Totals 5,343 5,152 10,495 17

 1 Source: USDOT Bureau of Transportation Statistics, TransStats Intermodal Database, Schedule T-100.
APPENDIX B

Page 4 of 4

Historical Origin-Destination Plane Traffic1

Show Low, Arizona

Quarter Year Deplanements Enplanements

Total 

Traffic

Enplanements 

per Day

3 2009 1,140 1,201 2,341 15

4 2009 797 796 1,593 10

1 2010 508 584 1,092 7

2 2010 742 797 1,539 10

Annual 

Totals 3,187 3,378 6,565 10

3 2010 966 1,049 2,015 13

4 2010 656 645 1,301 8

1 2011 447 516 963 6

2 2011 991 1,049 2,040 13

Annual 

Totals 3,060 3,259 6,319 10

3 2011 1,408 1,498 2,906 18

4 2011 994 933 1,927 12

1 2012 721 782 1,503 10

2 2012 1,011 1,013 2,024 13

Annual 

Totals 4,134 4,226 8,360 13

 1 Source: USDOT Bureau of Transportation Statistics, TransStats Intermodal Database, Schedule T-100.
Appendix C

Example of General Terms and Conditions for Essential Air Service

The carrier understands that it may forfeit its compensation for any flights that it does not operate 

in conformance with the terms and stipulations of the rate order, including the service plans 

outlined in the order and any other significant elements of the required service, without prior 

approval. The carrier understands that an aircraft take-off and landing at its scheduled 

destination constitutes a completed flight; absent an explanation supporting subsidy eligibility 

for a flight that has not been completed, such as certain weather cancellations, only completed 

flights are considered eligible for subsidy. In addition, if the carrier does not schedule or operate 

its flights in full conformance with the order for a significant period, it may jeopardize its entire 

subsidy claim for the period in question. If the carrier contemplates any such changes beyond 

the scope of the order during the applicable period of these rates, it must first notify the Office of 

Aviation Analysis in writing and receive written approval from the Department to be ensured of 

full compensation. Should circumstances warrant, the Department may locate and select a 

replacement carrier to provide service on these routes. The carrier must complete all flights that 

can be safely operated; flights that overfly points for lack of traffic will not be compensated. In 

determining whether subsidy payment for a deviating flight should be adjusted or disallowed, the 

Department will consider the extent to which the goals of the program are met and the extent of 

access to the national air transportation system provided to the community.

If the Department unilaterally, either partially or completely, terminates or reduces payments for 

service or changes service requirements at a specific location provided for under this order, then, 

at the end of the period for which the Department does make payments in the stipulated amounts 

or at the stipulated service levels, the carrier may cease to provide service to that specific 

location without regard to any requirement for notice of such cessation. Those adjustments in 

the levels of subsidy and/or service that are mutually agreed to in writing by the Department and 

carrier do not constitute a total or partial reduction or cessation of payment.

Subsidy contracts are subject to, and incorporate by reference, relevant statutes and Department 

regulations, as they may be amended from time to time. However, any such statutes, regulations, 

or amendments thereto shall not operate to controvert the foregoing paragraph.

Funds are not currently available for performance under this solicitation beyond [DATE]. The 

Department’s obligation for performance under this solicitation beyond [DATE], is contingent 

upon the availability of appropriated funds from which payment for services can be made. No 

legal liability on the part of the Government for any payment may arise for performance under 

this order beyond [DATE], until funds are made available to the Department for performance. If 

funds are not made available for performance beyond [DATE], the carrier will receive notice in 

writing by the Department.

All claims for payment must be submitted within 60 days of the last day of service provided 

under this order.